Australian and New Zealand dealmakers focus on portfolio reviews and unlocking synergies despite geopolitical uncertainties.

Our 19th Global Capital Confidence Barometer finds Australian and New Zealand executives expecting the M&A cycle to continue at elevated levels. An unprecedented 99% believe the local M&A market will remain stable or improving, with more than 92% expecting more or the same number of deal completions in the next 12 months compared to last year.

M&A outlook

92%

of executives expect more or the same number of deal completions in the next 12 months compared to last year

More than half (53%) plan to actively pursue M&A in the next 12 months – significantly above the long-term average of 43%. Nine in ten respondents expect their M&A pipeline to either increase or stay at the same level in the next 12 months.

Yet, their global counterparts have a less rosy market outlook. While respondents expect heightened levels of M&A, there is a decline in the percentage that expect to make acquisitions themselves in the next 12 months, with plans for M&A trending down to 46%. This puts global M&A appetite at the lowest point for four years, signaling that some global executives are looking to other companies to do the dealing rather than acquire themselves.

We have seen this dichotomy before in our survey. This is an indication that we will likely see a temporary pause in activity outside of our market. And it may be an important signal for the local Australian and New Zealand markets, which tend to lag global sentiment.

Overseas, regulatory and trade policy uncertainty is clearly giving some executives pause for thought, as is the need to fully integrate and properly digest acquisitions made to date.

Locally, a third of executives are now concerned about the implications of geopolitical risk on business growth. A year ago, only 16% said political uncertainty was a prominent feature in boardroom thinking. They also cite regulatory or government intervention as the primary reason for failing to complete or cancelling an acquisition.

Will local resilience in Australia and New Zealand continue? Or are we heading for a pause in M&A appetite for dealmaking as local executives follow the global trend?

Every transaction has tax implications, whether it’s an acquisition, disposal, refinancing, restructuring or initial public offering. Our extensive cross-border experience, strong international network and broad commercial focus can help you identify the critical strategic tax considerations and explain them in the context of your transaction and future plans for the business.

Summary

Our 19th Global Capital Confidence Barometer finds Australian and New Zealand executives expecting the M&A cycle to continue at elevated levels. An unprecedented 99% of respondents believe the local M&A market is stable or improving, with more than 92% expecting more or the same number of deal completions in the next 12 months compared to last year. Download the full report here (pdf).

EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients.

Welcome to EY.com

In addition to cookies that are strictly necessary to operate this website, we use the following types of cookies to improve your experience and our services: Functional cookies to enhance your experience (e.g. remember settings), Performance cookies to measure the website's performance and improve your experience, Advertising/Targeting cookies, which are set by third parties with whom we execute advertising campaigns and allow us to provide you with advertisements relevant to you, Social media cookies, which allow you to share the content on this website on social media like Facebook and Twitter.

You may withdraw your consent to cookies at any time once you have entered the website through a link in the privacy policy, which you can find at the bottom of each page on the website.